Regulation and Hotelling

An interesting question popped up on an episode of Ask a Winemaker. The host asked "Do you think that an identity of a Santa Barbara Syrah would be arrived at more switfly with less or more regulation?" The vintner's answer was yes, they would arrive at a recognizable character for the wines from their area if growers were limited in their choices of which clones to plant and how to make their wines. It was apparently assumed that recognition, or a consistent style, would be a good thing for the wine makers, probably so their customers would know what to expect based on appellation. Like Bordeaux or Burgundy or Napa Cabernets.

Devil's Dictionary of the Day

Let's go with... Reason:

REASON, v.i.


To weight probabilities in the scales of desire.

 Hmm, Bierce wrote the Devil's Dictionary in 1911, I'm going to go out on a limb and say public discourse in "the good old days" wasn't all that much more enlightened than it is today.

Why do economists always weigh in on climate change?

The following seems to articulate a lot of the feeling people have about economists taking part in the climate debate, at least when they're skeptical:

Economists of all stripes should strive to acquire some humility nowadays , given the disastrous failure to recognize an impending economic disaster.

From a comment on an environmental economics blog.

The Price is Right _and_ Publishable

A couple days ago I wondered if the game show The Price is Right would make a good natural economic experiment on auctions. Apparently it was worth at least a couple papers. There was a paper in the September 1996 issue of the American Economic Review finds that participants' bidding strategies are "transparently suboptimal" but they learn over the course of multiple attempts. I wonder if they mean bidding 1 dollar less than the person before you is what they consider "transparently suboptimal" or if they're seeing something more subtle?

An econ 10 question?

Reading through an old copy (September 2007) of the Journal of Economic Literature I found a review by Randall Morck of "The fable of the Keiretsu: Urban Legends of the Japanese Economy" by Yoshiro Miwa and Mark Ramseyer. The review was mixed, Morck celebrated that the authors debunked some of the myths about the Japanese economy and showed that it works largely like everyone else's, but was disappointed that they went too far and pushed some fallacies of their own.

Girls can't bid?

I just finished reading "Selection Bias, Demographic Effects, and Ability Effects in Common Value Auction Experiments" by Marco Casari, John C. Ham and John H. Kagel published in the September 2007 edition of the American Economic Review. It was a very interesting and quite accessible paper, I was even able to follow the math.

They set up an experiment to observe behavior is repeated auctions where winner's curse from overbidding could cause bankruptcy. Some of their more expected conclusions were that ability (measured by ACT/SAT scores) and experience through successful previous bids lead to higher profits. Interestingly, though, they find that women perform significantly worse than men when they're inexperienced bidders and all other factors are controlled for, but they learn much more quickly and eventually catch up and might even surpass men as experienced bidders. Also, while lower than average ACT/SAT scores are strongly correlated with poor performance, very high (top 5th percentile) are only weakly correlated with better performance. Finally, and perhaps most interesting, they were able to detect selection bias through their experiment design but were unable to do so using advanced statistical methods.

Winner's Curse and "The Price is Right!"

I was thinking about the competition between Exxon and a joint Chinese/Ghanan venture to bid for rights to the newly discovered Jubilee oil field. Is it likely that Exxon, an undoubtedly experienced bidder, put in a risk neutral or even a loss free bid on the field and will the Chinese company, with presumably less experience, win but suffer the winner's curse? If the Chinese company is backed by the Chinese government, will that backing make them willing to risk (or even take an intentional) loss in order to secure access to the oil? Or was Exxon putting in a non competitive bid to exploit Ghana?

Schoolgirls and Mobile Suits

A couple weeks ago I went to MCAD's Schoolgirls and Mobile suits anime conference for the first time. Since this is put on by the school and students can get academic credit for attending, I had high expectations. Those were met and exceeded.

The event ran two and a half days: Friday started late and only had the fashion show and a talk by fan-parody group VerrsenWerks. Saturday and Sunday both had morning art workshops (“Creating a Page From Start to Finish” and Tips and Tricks: Creating Comics”) as well as portfolio critiques and presentations in the afternoon. Since I have no artistic inclinations or aspirations, I skipped the morning sessions and went straight to the afternoon stuff. Hey, getting up before noon on a Saturday is pretty rough no matter how early I get to bed!

Friday night's "Fruits Basket Fashion Show" was a complete surprised. Since it's named after an anime and they mentioned cosplay in the description, I expected at least some people dressed up in poor imitations of anime characters. I couldn't have been more wrong. The show was conducted as a regular fashion show featuring each designer separately, and they were designers. Mostly local but there were a couple that traveled to attend, and most were professionals. There was no cosplay, instead the show featured Goth, Loli and Steampunk fashions. I didn't even know that steampunk was a fashion genre, but it seems a natural progression from Goth: Take corsets and fancy dresses, hats and bloomers then make them cool for today with a lot of earth tones, leather, straps and buckles. Think of how Hollywood would dress characters in a Cthuthlu movie and you probably have it. It was cool.

VerrsenWerks' presentation on parody dubs was what I would expect from a a normal anime convention, fans doing what they enjoy and presenters who have connections and a good understanding of their field. Parody dubs, where fans have overdubbed an anime themselves to parody the anime, the genre or fandom in general have never been much of an interest to me but the VerrsenWerks made a very interesting presentation of the phenomenon. They finished with a screening of their parody dub of Vampire Hunter D, which did make me laugh out loud at points.

The next two days contained the meat of the event and what probably sets it apart from cons like Otakon or Acen, the presentations.

Devil's dictionary of the day

DAMN, v.

A word formerly much used by the Paphlagonians, the meaning of which is lost. By the learned Dr. Dolabelly Gak it is believed to have been a term of satisfaction, implying the highest possible degree of mental tranquillity. Professor Groke, on the contrary, thinks it expressed an emotion of tumultuous delight, because it so frequently occurs in combination with the word jod or god, meaning "joy." It would be with great diffidence that I should advance an opinion conflicting with that of either of these formidable authorities.

And for a real word, how about castigate?

cas⋅ti⋅gate

–verb (used with object), -gat⋅ed, -gat⋅ing.

1.	to criticize or reprimand severely.

2.	to punish in order to correct.

Man, I love dictionary.com

Not about President Obama's peace prize

I went to see "The September Issue" at the Edina Cinema tonight. It told a good story, focusing on Vogue's editor-in-chief Anna Wintour's management of both the issue's development and how that parallel's her dominant role in the fashion world as a whole. Grace Coddington, Vogue's creative director features heavily as well. The documentary plays her more focused creativity of putting together fashions and photo shoots to create a specific story against Anna's grand scheme about what fashion and fashion in Vogue is. They might well be over stressing the conflict between the two, though. Throughout the movie there are repeated scenes of Grace doing a photo shoots followed by Anna cutting her favorite shots out of the spread. Yet you get one little hint at the end that all's not gloom and doom when we find out that, save the cover spread and one other, the entire issue is Grace's work.

I enjoyed it, though. It's not really my type of movie, I'm not really in to documentaries or fashion, but the review promised an insider's view of how Vogue worked. And I'm a sucker for seeing how businesses work.

Monopoly and literature?

This falls under the "I'd rather be lucky than good" category. I'm reading through some old issues of The American Economic Review and ran across an article on monopoly right as I was thinking about the previous post:

"Naked Exclusion, Efficient Breach, and Downstream Competition" by John Simpson and Abraham L. Wickelgren in the September 2007 issue of The American Economic Review

I haven't really even skimmed the article yet, but the radio program I heard compared the IBM complaints to the Microsoft case and mentioned bundling software. This article is probably over my head, but it sounds tantalizingly close to what IBM is doing. I'm thinking an exclusivity contract with a buyer would be equivalent to IBM's "You want to run my software? You run it on my hardware."

Here's the paper.

Monopoly! Monopoly! Monopoly?

So, over the summer there was talk about investigating deals between wireless carriers and phone manufacturers for antitrust violations.

Now the DoJ is looking into investigating IBM for anticompetetiveness. They refuse to license their software to potential competitors.

Finally, though I don't have a link, I swear I heard a story last night on the radio about potential action to force wireless providers to open their networks to competitors.

Things I don't understand and Things I don't know

Things I don't understand:

• Why do people trust governments when they don't trust markets or firms?
• Do people really think the US markets have truly been unregulated and our government has a laissez faire economic policy?
• Why do people think we're worse off than we were 10, 20, even 50 years ago?

Things I don't know:

• Is American medical care generally better, worse or equal to other first world countries'?
• What's the current state of the art in economic auction theory?
• Statistics. And Math, at least not enough of either to feel comfortable applying to grad school in Economics.
• Why does Cheapo seem to stock vastly more new CDs than used CDs but Half Price seem to stock primarily used books, and their new books are sold at a deep discount where Cheapo's new CDs aren't discounted much, if at all?
• Why is US medical care so expensive?
• If Keynes and other undergrad macro isn't what has been taught in graduate programs for a couple decades, what has been and why didn't it make its way to undergrad programs?
• How have American wages compared to European wages over the past few decades? How about total compensation?
• How competitive are markets in MMOs like World of Warcraft and Ragnarok Online?
• What kind of goop should I use in my hair?

These aren't necessarily topics I intend to explore here, but they are the type of question I find interesting.

I'm going to make one big, well researched post a week on this blog, and try to get at least some small tidbit a day in on something that piques my interest. I still haven't decided on when to make that post, probably a Wednesday or Thursday since that meshes with my work schedule well.